North American News
Major US indices close low for the second consecutive day
- NASDAQ index falls by 1%
Major US stock indices are closing the day lower. The declines led by the NASDAQ index which fell about 1% on the day.
A look at the final numbers shows:
- Dow industrial average fell -184.35 points or 0.57% at 32099
- S&P index fell -27.06 points or 10.67% at 4030.60
- NASDAQ index fell -124.03 points or -1.02% at 12017.68
- Russell 2000 fell -16.8 a points or -0.89% at 1882.941
The 3 major indices all closed below their 100 day MAs
- Dow 32488.94 vs close of 32099.
- S&P 4068.38 vs close at 4030.60
- Nasdaq 12109.73 vs 12017.68
Looking at the 11 sectors of the S&P, energy was the big gainer. Information technology was the worst performer.
The winners today were:
- Energy, +1.54%
- Utilities, +0.25%
- Consumer staples, -0.15%
The losers today were:
- Information technology, -1.28%
- Real Estate, -0.88%
- Communication services, -0.78%
Dallas Fed Manufacturing index -12.9 vs -22.6 last month
- Dallas Fed Manufacturing index
- Manufacturing index, -12.9 vs -22.6 last month
- Employment 15.6 vs 17.6 last month
- Hours worked 14.4 from 9.5 last month
- New orders -4.4 from -9.2 last month
- Production 1.2 vs 3.8 last month
- Raw material price paid 34.4 vs 38.4 last month
- Prices received 26.8 vs 29.3 last month month
- Shipments 3.4 vs 4.3 last month
- Growth rate of new orders -14.7 vs -12.0 last month
- Finished goods inventories 1.2 vs 4.7 last month
- Wages and benefits 45.8 vs 38.1 last month
- Capital expenditures 14.2 vs 4.2 last month
Commodities
Gold bulls pull out at key daily resistance
- Gold trades heavy in a bearish territory with potential demand sighted at around $1,710.
- Powell’s Jackson Hole speech has reinforced the message that multiple and sizable hikes are still in the pipeline, supporting the greenback.
The gold price has been put back under pressure in New York trade and is wilting below the European highs of $1,745.55. The yellow metal is now losing 0.10% at the time of writing while the greenback firms again, basing itself on a key measure vs a basket of rival currencies.
Powell’s Jackson Hole speech has reinforced the message that multiple and sizable hikes are still in the pipeline and that easing should not be expected to be on the horizon anytime soon. The outcome has weighed on precious metals that have dropped on the back of a surge in US dollar, making them more expensive for overseas buyers.
The prospects of higher interest rates and a jump in yields took the US dollar to a fresh two-decade peak at 109.478 on Monday after Powell stated that the central bank would raise rates as high as needed to restrict growth, and would keep them there “for some time” to bring down inflation that is running at more than three times the Fed’s 2% goal.
A capitulation on the gold price took effect on the back of his comments, chipping its way through the August lows and the week ahead could offer further catalysts from key economic data and Fed speakers. To start, embedding the hawkish sentiment, on Monday, in response to the market’s reaction to last week’s Jackson Hole, Minneapolis Federal Reserve Bank President Neel Kashkari crossed the wires emphasizing a seriousness about getting inflation back to 2%.
We will hear from other Fed officials and the data will be key with this Friday’s US job report the highlight. The data is likely to show a robust outcome for August, according to analysts at TD Securities.
Nevertheless, the euro could benefit should the report show a more moderate pace following the booming 528k print registered in July. ”High-frequency data, including Home base, point to still above-trend job creation the analysts say. ”We also look for the UE rate to drop by a tenth for a second consecutive month to 3.4%, and for wage growth to advance at a firm 0.4% MoM (5.3% YoY),” the analysts said.
WTI crude oil futures settled at $97.01 that’s up $3.95 or 4.24%
- The high price reached $97.36. The low price extended to $92.30
The price of WTI crude oil is settling at $97.01. That is the highest since July 29. The settled price is also back above the 200 day MA at $96.02. Reasons for the rise?
- Clashes in Libya threaten supply
- Meeting with OPEC+ is also a concern as Saudi threathens production cuts
Recent inventory data showed larger drawdown of inventories. A counter to the upside is a potential nuclear deal with Iran which could add 1M BPD to the market.
EU News
European shares end the day lower
- German DAX -0.61%
The major European stock indices are ending the day in the red on follow-through selling following Powell’s Jackson Hole symposium speech:
- German DAX, -78.48 points or -0.61%
- France’s CAC -51.98 points or -0.83%
- Spain’s Ibex -74.32 points or -0.92%
- Italy’s FTSE MIB -61 points or -0.28%
Other News
IEA Head Birol: Further strategic petroleum release, not off the table
The EIA head Birol is on the wire saying that:
- Further Strategic Petroleum Reserve release not off the table.
- Stands by the IEA’s report that said no new investments in oil and gas fields area needed if the world wants to achieve net zero report emissions by 2050
- Russian oil production has not fallen as much as previously expected, managed to find new markets Europe
In other weekend news on oil, Elon Musk said:
Realistically, I think we need to use oil and gas in the short term, because otherwise civilization will crumble.
Cryptocurrency News
The slump in Bitcoin is being cited on Fed Chair Powell’s speech on Friday flagging ‘Forceful’ action on inflation and rates
Monetary Authority of Singapore considering further crypto regulation measures
Comments from the Managing Director of the Monetary Authority of Singapore, Ravi Menon.
Headlines via Reuters
- MAS cannot compromise its due diligence process for licence applications for digital players
- Considering further measures to reduce harm to consumers from cryptocurrency trading
- Public consultation on new measures to be issued in October
- MAS will propose regulatory approach for stablecoins